The Minister for Pensions (Malcolm Wicks):
For the first time we now have a system that helps more women to build up a decent second pension. State second
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pension provides an additional pension for low earners, including carers and disabled peoplethe very people who were excluded from the previous state earnings-related pensions scheme. State second pension will lift the incomes of a generation of future female pensioners. The latest data from the Family Resources Survey show that around 12.2 million women of working age are now accumulating the state second pension, compared to 13.4 million men.
Mrs. Campbell: I thank my hon. Friend for that reply. Does he agree that being in work is absolutely crucial to future pensions provision? Does he further agree that scrapping the new deal for lone parents, which has helped hundreds of lone parents in my constituency, will have a catastrophic effect on future pension provision for many women?
Malcolm Wicks: Yes, indeed. My hon. Friend's question reminds us that what we are doing in respect of employment policy and our success in moving back towards full employment will have a crucial impact on pensions for women as well as men. The impact of giving women the opportunity to have successful careers and of providing help with child care shows that those policies are as much pension policies as the formal pension policies that we tend to discuss at Question Time.
Miss Anne McIntosh (Vale of York) (Con): What assessment has the Minister made of the recent TUC report, particularly on the implications for women who work part time and earn substantially less22 per cent. lessthan men? About 15 per cent. of the unskilled workers among the women work force are not part of an occupational pension scheme. What are the Government going to do for them?
Malcolm Wicks: That is one of the difficulties that we face, but I hope that the hon. Lady would acknowledge that the Government have done a good deal to enhance the status of the part-time worker, who is as important to a modern economy as the full-time worker. That is why we have given new rights to part-time members of the work force to be members of occupational pension schemes, which is a great step forward. As I said earlier, I am not complacent about these matters. We will consider the TUC reportI spoke at its conferenceand we hope to move forward in the future.
Chris McCafferty (Calder Valley) (Lab): Does my hon. Friend agree with the Pensions Policy Institute, which has said that that the average woman will lose out under the Conservatives' proposed policy? Can he comment on what the effect on women pensioners would be of the Tory party's plans to abolish the second state pension?
Helen Jackson (Sheffield, Hillsborough)
(Lab): Does my hon. Friend agree that it is important for every individual, male and female, to think about making a contribution to their income in retirement throughout their working lives? Will he ensure that the state second
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pension has the flexibility necessary to make it easy for women in part-time jobs and in a variety of jobs through their working lives to build up a contributory pension that is tailored to their needs?
Malcolm Wicks: We need to recognise that much of the useful work or activity in society takes place outside the formal labour market. The history of pension policy since the second world war is GovernmentsI must point out that that means Labour Governmentsrecognising that caring for children is important and should be credited into a basic state pension. This Labour Government have recognised that the balance of care is almost shifting towards caring for elderly relatives and that is why we are crediting that into the new state second pension. Progress has been made, and that will show up in the average basic state pensions that people retire on in the middle decades of this century. However, we need to do more.
The Secretary of State for Work and Pensions (Alan Johnson): We have acknowledged problems with the CS2 IT system. The agency is working with EDS to resolve those problems. Work to stabilise the system is under way and that has already brought about improvements. We expect the remedial work to be complete in spring 2005.
We want people who are still on the old scheme to experience the advantages of the reforms as soon as possible, but we are determined not to repeat the mistakes of 1993 when the old scheme was brought in far too quickly.
Mr. Heath: The Government's record in procuring, and suppliers such as EDS in supplying, major IT schemes is appalling, so we are all looking forward to the ID scheme system. I understand what the Secretary of State is saying about stocktaking before moving to a clear timetable for migration, but does he believe that his Department is in any way vulnerable to legal challenge by those who are put at a financial disadvantage compared with others in exactly the same circumstances who are on the new scheme? Does he propose to do anything about that inequity or is the game plan simply to wait for those children to grow up and the problem to solve itself?
I am not sure whether the hon. Gentleman was able to join us last week for the interesting debate on that issue on estimates day, opened by the hon. Member for Roxburgh and Berwickshire (Sir Archy Kirkwood). First, there is no legal liability. The two systems are in separate legislation, so there is no legal redress against the Government for not being transferred from system 1 to system 2. Secondly, system 1 has advantages, as I pointed out in the debate. If the parent with careusually a womangets a job, she qualifies for £5 a week arrears, which is £1,000, as opposed to the £10 disregard under system 2. The hon. Member for Somerton and Frome (Mr. Heath) reminds
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me of a point that I did not pick up in that debate, which is the suggestion that somehow we want to sit around until the kids on the original system grow upthat might be something that we could recommend to some Opposition Membersand let the problem wither on the vine. That suggestion is beneath the Liberal Democrats
Alan Johnson: I am told that nothing is beneath them. I assure hon. Members, especially the hon. Member for Roxburgh and Berwickshire, who did not raise this issue but has a close interest in it, that nothing could be further from our thoughts. We want people to swap to CS2. It had the support of the whole House, not least because it is simpler and gives the £10 disregard, and we are determined to switch to it as quickly as possible, commensurate with avoiding the problems that we have faced previously. I am happy to give that assurance on record to the House.
Mrs. Gwyneth Dunwoody (Crewe and Nantwich) (Lab): Nevertheless, does not my right hon. Friend see a slight irony in the fact that, at a time when many DWP employees in my constituency are being forcibly removed from Crewe to Chester, adding an hour and a half to their working day, only the availability of civil servants who could continue the payment of benefits by writing everything out by hand saved my constituents from considerable inconvenience?
Alan Johnson: I think that my hon. Friend is talking about the problem we experienced a couple of weeks ago when 80 per cent. of our desktop computers closed down. Although that did not affect benefit recipients, because the mainframe computers were unaffected, it affected our staff, who had to work really hard to ensure that more damage was not done. My hon. Friend may be interested to know that EDS has told us that it was responsible for what happened a couple of weeks ago. The company has given us a report on how it happened and I have shared that with the Opposition. I record my thanks to our staff for ensuring that what could have made a much more profound difference to our customers did not, and that we actually recovered the situation.
Mr. Tim Boswell (Daventry) (Con): The Secretary of State will recall that for the past couple of years I have been away shadowing different portfolios. I left with the memory in my ears of his predecessors, the right hon. Members for Edinburgh, Central (Mr. Darling) and for Oxford, East (Mr. Smith), saying that there was no intention to move the CSA system until the thing was working properly, that it would be robust and that until it was robust it would not be introduced for new cases, let alone for existing ones. The House will have noticed that the present Secretary of State is saying exactly the same thing and giving a timetable of spring next yearI wonder why.
What will the Secretary of State say to the many thousands of casesthat means peoplewho are suffering because their assessments have been frozen in
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the present system? Are they not reasonable in concluding that this is all talk? They want a bit of action and accountability.
The hon. Gentleman is absolutely right about previous statements. As we said in the debate last week, no Government are blameless on those IT failures. He would be the last person to suggest that the Government of whom he was a distinguished memberin the Department of Trade and Industrydid not run into similar problems. One has only to say the word "Horizon" to make them come over all pale and quivering. Previous Secretaries of State twice put off the introduction of CS2. It was due to be implemented inI thinkOctober 2001. It was put back by my right hon. Friend the Member for Edinburgh, Central and put back again by my predecessor, my right hon. Friend the Member for Oxford, East. As we said in the debate, there was not exactly a rush to get CS2 started; in fact, there were serious concerns. In the end, we were assured that the system would work well and properly, but it did not and we are still feeling the effects.
Finally, I did not say that we would go live in spring next year. In the debate last week, I said that spring 2005April 2005, to be preciseis when the last piece of kit will be put in by EDS, which should rectify the horrendous problems that our staff have been facing with that particular system.